Collecting art is very personal. Despite the interest in art investment, the use of art as a portfolio diversifier simply does not make sense for most people. Among others, you may not have the budget to buy investment-grade art or the cash to sit out the market cycle of this illiquid asset. Therefore, particularly when you start to collect, I recommend that you buy what you love. Ultimately you will have to live with your purchase and if you can’t see that happening, you should probably not buy it. That said, you can certainly be smart about buying art. If you don’t have the expertise yourself, engaging a professional art advisor is a prudent decision to make. Check out the seven ways an art advisor can help you purchase the right piece.
1. Does your legwork
Despite the opacity of the art market, price comparables certainly exist. Databases of public auction records are available online (i.e. artnet.com) and will give you an idea of the value of artworks traded on the secondary market. That said, you probably won’t have the experience and knowledge to analyse the numbers correctly. Listings in price databases don’t provide the underlying reasons for a certain result achieved at auction, such as patchy provenance or condition issues. An art advisor will be able to make sense of the indices and also has access to insider information from galleries and auction houses allowing them to advise you on the appropriate price level for the artwork of your choice.
2. Helps you determine your taste in art
The art market can be quite intimidating for novice collectors (I certainly remember my first visit to a London art gallery more than 16 years ago – absolutely terrifying). However the key to collecting in a smart way is to educate yourself by viewing art at galleries, fairs and museums and to read up on the artists you discover. An art advisor will be very helpful in this regard: they will educate you on specific artists, artist movements and the art market. They will get you VIP tickets to art fairs and invitations to gallery openings and studio visits. If you don’t have the time to be involved in buying the artworks yourself, you can certainly let your art advisor choose them for you, as long as you make sure you don’t end up with the same stuff as your neighbours! Your own personal taste is what makes your collection unique.
3. Gives you access to off-market opportunities
Many, if not most contemporary galleries operate a waitlist or will sell to their most loyal collectors before offering the works to other buyers. This selectivity makes sense. The gallery is protecting their artists’ market by placing the works in respected collections and reduce the risk of the work being flipped (quickly resold for a profit). The latter is destabilising for an emerging artist’s price levels which is why galleries seek to avoid this scenario at all cost. An art advisor has a strong network of fellow art advisors, galleries and collectors. Chances are that if a particular work becomes available they will know about it which means that you’ll be able to get access to the work before the general public.
4. Helps you to make an informed purchase
There is falling in love with an artwork, and then there is the reality that not all artworks are created equal, even within the oeuvre of one artist. An art advisor will let you know which artworks are quality and which are not, all within the parameters of your budget and personal preference. They will also let you know which works are more prone to deterioration than others (think shark, tank and formaldehyde) which will help you to avoid buying a work that will require costly conservation treatments further down the line.
5. Negotiates a better deal for you
It is easy to overpay for an artwork. This is partly due to the asymmetry of information in the art market: the seller almost always knows more about the work than the buyer. An art advisor will prevent you from overpaying. Firstly by doing price research so that you can take an informed decision and secondly by negotiating with galleries to get you a better deal. Galleries usually provide discounts to art advisors. Make sure these are passed on to you. As the market is so opaque, when transacting privately it is not always possible to find out if the party on the other side of the transaction has a financial interest in the work. Therefore it is paramount that your art advisor is completely independent from your counterpart in the transaction so that they can negotiate the best possible deal for you without a conflict of interest.
6. Bids for you at auction
Remember I said it’s easy to overpay? That is also because you may fall in love with an artwork so badly that you can’t stop bidding at auction. Engaging an art advisor to represent you at auction is really helpful, they are experienced in bidding and they will not exceed the maximum bid that you have set with them. Even if you prefer to bid yourself, in the excitement of the auction room, as opposed to bidding on the phone or online, it’s helpful to have them sit next to you so that they can whack you over the head with your paddle before you remortgage your home (so to speak).
7. Arranges logistics: viewing, installation and shipping
An art advisor takes care of all the logistics from arranging a viewing at the gallery or storage facility to shipping and installation of the work you purchased. These technicalities are boring but important, particularly when you are spending a lot of money. Some art advisors manage their clients’ collections on their behalf. This service saves you a lot of time in terms of administration and logistics and gives you the reassurance that your art is adequately insured.
Now just make sure to choose a really good art advisor, someone who will respond appropriately to the following questions: ‘Do you work with contracts’ (yes), ‘How do you get remunerated’ (commission, flat fee or a combination) and ‘Do you have your own inventory of art ‘ (no). Enjoy your first purchase!